The concept has won praise from former British prime minister Tony Blair, who described it as a great example of Australian philanthropy.

Mr Forrest says the technology, developed by Curtin University, has the potential to be cost-effective.

"Turning lignite to diesel is proved - so we have no doubt it's going to happen," he said.

"The economic cost is the question, and that's why we're using Curtin University technology to get that cost as low as possible, so the advantage to the people of Pakistan is as high as possible."

Mr Forrest has previously invested millions of dollars in Aboriginal employment initatives in Australia and in 2012 founded Walk Free, a philanthropic charity focused on ending slavery worldwide.

He also helped to launch a global slavery index, alongside Mr Blair and former US secretary of state Hillary Clinton, which found that 29 million people were living in conditions of modern slavery around the world.